CMI - Cummins: An Industrial Force Worth Considering

2024-03-18 13:35:29 ET

Summary

• Cummins is a leading American manufacturer of powertrains and related components, serving industrial mobility applications worldwide.
• The company operates in five segments, including Components, Engine, Distribution, Power Systems, and Accelerate.
• Industrial production in the US has stabilized above 10-year average levels, indicating the need for cost effectiveness, innovation, and product differentiation for growth.
• The company has displayed strong financial performance and currently offers an attractive valuation proposition.

Thesis

Industrials have been hit hard both by the spread of the Covid-19 pandemic and the subsequent inflationary crisis around the world. Despite rising input costs and macroeconomic uncertainty, businesses like Cummins Inc. (CMI), a leading manufacturer of powertrains, have managed to persevere and even record strong financial performance over the past couple of years....

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